diff --git a/api/v1beta1/gcpmachine_types.go b/api/v1beta1/gcpmachine_types.go
index 7e27e7845..dc7c3c012 100644
--- a/api/v1beta1/gcpmachine_types.go
+++ b/api/v1beta1/gcpmachine_types.go
@@ -217,6 +217,16 @@ type CustomerEncryptionKey struct {
 	SuppliedKey *SuppliedKey `json:"suppliedKey,omitempty"`
 }
 
+// ProvisioningModel is a type for Spot VM enablement.
+type ProvisioningModel string
+
+const (
+	// ProvisioningModelStandard specifies the VM type to NOT be Spot.
+	ProvisioningModelStandard ProvisioningModel = "Standard"
+	// ProvisioningModelSpot specifies the VM type to be Spot.
+	ProvisioningModelSpot ProvisioningModel = "Spot"
+)
+
 // GCPMachineSpec defines the desired state of GCPMachine.
 type GCPMachineSpec struct {
 	// InstanceType is the type of instance to create. Example: n1.standard-2
@@ -302,6 +312,13 @@ type GCPMachineSpec struct {
 	// +optional
 	Preemptible bool `json:"preemptible,omitempty"`
 
+	// ProvisioningModel defines if instance is spot.
+	// If set to "Standard" while preemptible is true, then the VM will be of type "Preemptible".
+	// If "Spot", VM type is "Spot". When unspecified, defaults to "Standard".
+	// +kubebuilder:validation:Enum=Standard;Spot
+	// +optional
+	ProvisioningModel *ProvisioningModel `json:"provisioningModel,omitempty"`
+
 	// IPForwarding Allows this instance to send and receive packets with non-matching destination or source IPs.
 	// This is required if you plan to use this instance to forward routes. Defaults to enabled.
 	// +kubebuilder:validation:Enum=Enabled;Disabled
diff --git a/api/v1beta1/zz_generated.deepcopy.go b/api/v1beta1/zz_generated.deepcopy.go
index 78c0f8571..3c8560ad9 100644
--- a/api/v1beta1/zz_generated.deepcopy.go
+++ b/api/v1beta1/zz_generated.deepcopy.go
@@ -475,6 +475,11 @@ func (in *GCPMachineSpec) DeepCopyInto(out *GCPMachineSpec) {
 		*out = new(ServiceAccount)
 		(*in).DeepCopyInto(*out)
 	}
+	if in.ProvisioningModel != nil {
+		in, out := &in.ProvisioningModel, &out.ProvisioningModel
+		*out = new(ProvisioningModel)
+		**out = **in
+	}
 	if in.IPForwarding != nil {
 		in, out := &in.IPForwarding, &out.IPForwarding
 		*out = new(IPForwarding)
diff --git a/cloud/scope/machine.go b/cloud/scope/machine.go
index 96f745822..ce5d02d55 100644
--- a/cloud/scope/machine.go
+++ b/cloud/scope/machine.go
@@ -402,6 +402,16 @@ func (m *MachineScope) InstanceSpec(log logr.Logger) *compute.Instance {
 			Preemptible: m.GCPMachine.Spec.Preemptible,
 		},
 	}
+	if m.GCPMachine.Spec.ProvisioningModel != nil {
+		switch *m.GCPMachine.Spec.ProvisioningModel {
+		case infrav1.ProvisioningModelSpot:
+			instance.Scheduling.ProvisioningModel = "SPOT"
+		case infrav1.ProvisioningModelStandard:
+			instance.Scheduling.ProvisioningModel = "STANDARD"
+		default:
+			log.Error(errors.New("Invalid value"), "Unknown ProvisioningModel value", "Spec.ProvisioningModel", *m.GCPMachine.Spec.ProvisioningModel)
+		}
+	}
 
 	instance.CanIpForward = true
 	if m.GCPMachine.Spec.IPForwarding != nil && *m.GCPMachine.Spec.IPForwarding == infrav1.IPForwardingDisabled {
diff --git a/config/crd/bases/infrastructure.cluster.x-k8s.io_gcpmachines.yaml b/config/crd/bases/infrastructure.cluster.x-k8s.io_gcpmachines.yaml
index 291043919..5dbe18c8a 100644
--- a/config/crd/bases/infrastructure.cluster.x-k8s.io_gcpmachines.yaml
+++ b/config/crd/bases/infrastructure.cluster.x-k8s.io_gcpmachines.yaml
@@ -237,6 +237,15 @@ spec:
                 description: ProviderID is the unique identifier as specified by the
                   cloud provider.
                 type: string
+              provisioningModel:
+                description: |-
+                  ProvisioningModel defines if instance is spot.
+                  If set to "Standard" while preemptible is true, then the VM will be of type "Preemptible".
+                  If "Spot", VM type is "Spot". When unspecified, defaults to "Standard".
+                enum:
+                - Standard
+                - Spot
+                type: string
               publicIP:
                 description: |-
                   PublicIP specifies whether the instance should get a public IP.
diff --git a/config/crd/bases/infrastructure.cluster.x-k8s.io_gcpmachinetemplates.yaml b/config/crd/bases/infrastructure.cluster.x-k8s.io_gcpmachinetemplates.yaml
index 013c01776..ece5bc8d8 100644
--- a/config/crd/bases/infrastructure.cluster.x-k8s.io_gcpmachinetemplates.yaml
+++ b/config/crd/bases/infrastructure.cluster.x-k8s.io_gcpmachinetemplates.yaml
@@ -252,6 +252,15 @@ spec:
                         description: ProviderID is the unique identifier as specified
                           by the cloud provider.
                         type: string
+                      provisioningModel:
+                        description: |-
+                          ProvisioningModel defines if instance is spot.
+                          If set to "Standard" while preemptible is true, then the VM will be of type "Preemptible".
+                          If "Spot", VM type is "Spot". When unspecified, defaults to "Standard".
+                        enum:
+                        - Standard
+                        - Spot
+                        type: string
                       publicIP:
                         description: |-
                           PublicIP specifies whether the instance should get a public IP.
diff --git a/docs/book/src/topics/preemptible-vms.md b/docs/book/src/topics/preemptible-vms.md
index b0e9636d9..c18bb812c 100644
--- a/docs/book/src/topics/preemptible-vms.md
+++ b/docs/book/src/topics/preemptible-vms.md
@@ -28,3 +28,27 @@ spec:
     vmSize: E2
     preemptible: true
 ```
+
+## Spot VMs
+[Spot VMs are the latest version of preemptible VMs.](https://cloud.google.com/compute/docs/instances/spot)
+
+To use a Spot VM instead of a Preemptible VM, add `provisioningModel` to `GCPMachineTemplate` and set it to `Spot`.
+
+```yaml
+apiVersion: infrastructure.cluster.x-k8s.io/v1beta1
+kind: GCPMachineTemplate
+metadata:
+  name: capg-md-0
+spec:
+  region: us-west-1
+  template:
+    osDisk:
+      diskSizeGB: 30
+      managedDisk:
+        storageAccountType: STANDARD
+      osType: Linux
+    vmSize: E2
+    provisioningModel: Spot
+```
+
+NOTE: specifying `preemptible: true` and `provisioningModel: Spot` is equivalent to only `provisioningModel: Spot`. Spot takes priority.